Bharti Airtel, in its fresh plea, has sought review of the directions on the aspects of levy of interest, penalty and interest on penalty relating to AGR, a source related to the development said. One of the review petitions has sought open court hearing in the matter.
The companies that have approached the DoT flagging their concerns on pending dues include Sterlite, Tejas, Paramount Wires And Cables Ltd (PWCL), Aksh Optifibre, Finolex among others, and the dues run into Rs 1,600 crore, said Sandeep Aggarwal, Managing Director of Paramount Communications.
The industry body drew parallels between the airlines and telecom sector where both have faced consolidation, price wars and are capital intensive sectors which have high taxes. The letter highlights the impact of AGR dues which if recovered, will impact viability of telcos and other players in the industry.
The tower companies could consider payment holidays for Vodafone Idea and Bharti Airtel for the first three-to-six months on new sites or do away with the lock-in period for new tenancies, industry officials said.
The move, which will give over Rs 42,000 crore of relief to the telcos, may not be enough to address the debt concerns of the troubled telcos and ‘much more was needed’ from the government, primarily on adjusted gross revenue (AGR), which may boost stock prices if interest and penalties were waived, according to analysts.
As proposed by Committee of Secretaries, GST Council to take final call. Input tax credit worth some Rs 18,000 crore for Reliance Jio, about Rs 10,000 crore for Bharti Airtel and roughly Rs 8,000 crore for Vodafone Idea are currently stuck with the finance ministry.
The government doled out a Rs 42,000 crore relief to debt-laden teleos after it agreed not to take any payments for spectrum they use for the next two years. The Union Cabinet headed by PM Modi approved giving Airtel, Voda-Idea and Reliance Jio an option to avail a two-year moratorium on payments they were supposed to make in yearly installments.
The Union Cabinet headed by Prime Minister Narendra Modi approved giving Bharti Airtel, Vodafone Idea Ltd and Reliance Jio an option to avail a two-year moratorium on payments they were supposed to make in yearly installments for the spectrum bought in auctions.
"While operators would love to go to a single network, it saves them money as well, but we can't force people to do things that they don't want to do, we must let the market decide and let the customer decide,” said Rajan Mathews, director general of Cellular Operators Association of India (COAI) said.
Owing to a tariff hike by Reliance Jio in its voice and data packages, rival companies Vodafone idea and Airtel said they would increase tariff with effect from December this year. State-owned BSNL has also reviewed its plans and is set to raise prices from December, 2019 to beat sectoral stress.
The industry body has been regularly highlighting the perils of the sector under a debt of Rs 7 lakh crore and had asked for relief from the taxes levied upon the operators. The Cabinet's decision will give immediate relief of over Rs42,000 crore to India’s three mobile phone companies.
The government has earlier said that till the completion of the merger, Mahanagar Telephone Nigam Ltd (MTNL) will operate as a subsidiary of Bharat Sanchar Nigam Ltd (BSNL). Both the debt-ridden companies have rolled out voluntary retirement scheme (VRS), which is open for employees till December 3.
Last month, the government approved a Rs 69,000 crore revival package for BSNL and MTNL that included merging the two loss-making firms, monetising their assets and giving VRS to employees. The package includes infusion of Rs 20,140 crore for purchase of 4G spectrum and Rs 3,674 crore for GST to be paid on spectrum allocation.